Duke says moving coal ash would cost up to $10 billion

RALEIGH, N.C. — Duke Energy told North Carolina lawmakers Tuesday that removing all of the company’s coal ash away from the state’s rivers and lakes would take decades and cost up to $10 billion, with its electricity customers likely footing nearly all the bill.

In a presentation to a state legislative committee, Duke’s North Carolina president Paul Newton suggested the company needs flexibility to consider more cost-efficient options. The company’s proposal is to remove the coal ash stored in unlined dumps at three of its power plants, but then potentially leave much of it at its other sites in place after being covered with giant tarps and topped with soil.

Environmental groups are calling for new legislation requiring Duke to move its coal ash to lined landfills away from waterways following the massive Feb. 2 spill from a collapsed pipe in Eden that coated 70 miles of the Dan River in gray sludge.

State officials say all of Duke’s 33 unlined dumps at 14 coal-fired power plants scattered across the state are oozing out contaminates into the ground. All told, Duke has more than 100 million tons of coal ash that contains numerous potentially harmful chemicals, including arsenic, lead, mercury and chromium.

Newton made no mention of that ongoing pollution as part of his presentation, which included photos of pine trees, waterfowl and deer living at some of the company’s older ash dumps closed in the 1970s. He also emphasized recent testing that shows the high levels of toxic chemicals present in the Dan River immediately after the spill have dropped back to within state safety limits.

“We are doing, and will continue to do, what it takes to make this right,” said Newton, who repeated his earlier public apologies for the spill.

Duke, the nation’s largest electricity company, has spent more than $15 million to plug the pipe that collapsed at its Eden plant. It has also begun dredging out large deposits of ash found on the river bottom at three locations, the furthest more than 20 miles downstream in Danville, Va. The company has said it will pay for the spill cleanup, but may ask state regulators to raise the rates it charges customers for any additional costs incurred as a result of new regulations or requirements at its other sites.

To help illustrate the potential challenge and expense of moving all the company’s ash, Newton showed a graphic of what it would take to clear out the 22 million pounds stored at the Marshall Steam Station on Lake Norman, near Charlotte. If workers hauled away a dump truck full every three minutes for 12 hours a day, six days a week, Newton said it would take 30 years to remove all the ash from just that one facility.

Newton also disputed a recent finding by North Carolina environmental officials that Duke broke the law when it pumped out 61 million gallons of contaminated water from one of its dumps into the Cape Fear River, describing a large crack found in an earthen dam there as a “superficial gap” that the company quickly repaired.

Molly Diggins, the director the N.C. Sierra Club, urged lawmakers to pass a new law with firm requirements and deadlines that would make Duke deal with its coal ash pollution in a timely manner.

“Despite being a Fortune 500 company, with profits of $2.7 billion last year, Duke Energy has successfully been allowed to manage its wet coal ash waste as if the clock had stopped half a century ago,” Diggins said. “Coal ash is a can that has been kicked down the road for far too long. The Dan River spill was a terrible disaster, but it’s opened all our eyes to the reality that we need to deal with our state’s coal ash problem now.”

Duke should move all its coal ash into lined, dry pits and stop disposing of it in ponds, Frank Holleman, an attorney with the Southern Environmental Law Center, told Bloomberg News. Unlined ponds invariably contaminate ground water, and their dams can fail, he said.

The North Carolina Utilities Commission will decide who pays for the cleanup, Holleman said. “Our position is that law- abiding citizens should not pay,” he said. Duke shareholders are liable for the cost because its ash ponds violate pollution laws, Holleman said.

Some analysts disagree with that position.

“The costs of cleaning up the waste from fuel from coal should be a ratepayer cost and not a shareholder cost,” Kit Konolige, an analyst with BGC Partners LP in New York, told Bloomberg News. “The traditional regulatory compact, the cost of fuel and cost of cleanup of fuel, should be passed through ratepayers. It really shouldn’t come out of shareholders’ pockets except to the extent that the company has done something wrong.”